DTN News - DEFENSE NEWS: Australia Continues To Boost Its Military, With The Purchase Of 12 New Submarines A Part Of A US$44Bn Upgrade

DTN News - DEFENSE NEWS: Australia Continues To Boost Its Military, With The Purchase Of 12 New Submarines A Part Of A US$44Bn Upgrade

Source: DTN News - - This article compiled by Roger Smith from reliable sources Research and Markets On Friday January 28, 2011, 4:00 pm EST

(NSI News Source Info) TORONTO, Canada - January 29, 2011: Australia's relationship with China has become increasingly important in recent years, owing to China's emergence as Australia's biggest export destination, having overtaken Japan. Australia has traditionally been a very close ally of the US, but Canberra must increasingly tread a fine line between fostering closer economic cooperation with Beijing while guarding against China's rising military power. The Australian government has continued to boost its military capabilities, with the purchase of 12 new submarines as part of a US$44bn upgrade plan.

Canberra has also made efforts to increase regional military cooperation potentially as a hedge against China by signing a security pact with Japan. In light of Australia's longstanding security ties with the US, some Chinese strategic planners may interpret three-way defence cooperation between Canberra, Tokyo and Washington as being aimed at curbing Beijing.

The slowdown in Australia's real GDP growth in Q310 is in line with our bearish view that weakening investment and private consumption growth will cause a drag in headline expansion going forward. Indeed, we are pencilling in economic growth of only 1.6% and 2.3% for 2011 and 2012 respectively, weaker than the forecast 2.8% expansion in 2010.

Australia's economic growth decelerated considerably in Q310, expanding by only 0.2% quarter-on-quarter (q-o-q) (seasonally-adjusted), from a revised 1.1% registered in Q210. The recent slowdown in the country's real GDP expansion was in line with our view that the rise in borrowing costs, fall in consumer confidence, and weakening residential property sector will lead to lower headline growth going forward. With this in mind, we maintain our view that the Australian economy will expand by only 1.6% in 2011, before rebounding slightly to 2.3% in 2012. These figures are much lower than our projected 2.8% growth for Australia in 2010

*This article is being posted from Toronto, Canada By DTN News ~ Defense-Technology News, contact: dtnnews@ymail.com

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DTN News: First Aegis Weapon System Completed For Royal Australian Navy

DTN News: First Aegis Weapon System Completed For Royal Australian Navy *Source: DTN News / Lockheed Martin (NSI News Source Info) MOORESTOWN, NJ, - December 2, 2009: Lockheed Martin [NYSE: LMT] celebrated the completed production of the first Aegis Weapon System for the Royal Australian Navy’s Air Warfare Destroyer (AWD-1) Program. In a “pull-the-plug” ceremony at its Moorestown facility, Lockheed Martin marked the successful completion of a full range of acceptance tests conducted over several months to verify system performance. This milestone indicates the Aegis system is now ready for shipboard installation on HOBART, the first of Australia’s three planned Aegis-equipped destroyers. In 2007, the U.S. Navy awarded Lockheed Martin a contract to equip the three Australian ships with the Aegis. The first AWD-1 system will now be packed and shipped to ASC Shipyard in Adelaide, South Australia. HOBART is expected to be delivered to the Royal Australian Navy in December 2014. “This ceremony represents the culmination of an exceptional effort to deliver a tested Aegis Weapon System for the Australia Air Warfare Destroyer,” said Rear Admiral Terry Benedict, Program Executive Officer for Integrated Warfare Systems, U.S. Navy. “I want to congratulate the AWD Team, both in Australia and in the United States, on this significant achievement.” “We are so pleased to be a part of this international effort,” said Orlando Carvalho, vice president and general manager of Lockheed Martin’s Surface/Sea-based Missile Defense business based in Moorestown. “The Lockheed Martin team, along with our U.S. Navy and Australian industry partners, the Defense Materiel Organization, Raytheon Australia and ASC Shipbuilding, continue to deliver the world’s finest combat system to our customers, and that makes all of us very proud to be part of this program.” The Aegis system enables destroyers to engage simultaneous threats from under the sea, the surface and the air. The 92 Aegis-equipped ships currently in service around the globe have more than 950 years of at-sea operational experience and have launched more than 3,500 missiles in tests and real-world operations. In addition to the U.S. and Australia, Aegis is the maritime weapon system of choice for Japan, Norway, South Korea and Spain. Lockheed Martin is a world leader in systems integration and the development of air and missile defense systems and technologies. It also has considerable experience in interceptor systems, kill vehicles, battle management command, control and communications, precision pointing and tracking optics, as well as radar and other sensors that enable signal processing and data fusion. The company makes significant contributions to nearly all major U.S. Missile Defense Systems and participates in several global missile defense partnerships. Headquartered in Bethesda, Md., Lockheed Martin is a global security company that employs about 140,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. The corporation reported 2008 sales of $42.7 billion.

DTN News: Singapore, Australia Conduct Joint Naval Exercise

DTN News: Singapore, Australia Conduct Joint Naval Exercise *Source: DTN News / Defense Media

(NSI News Source Info) SINGAPORE - September 19, 2009: SINGAPORE and Australian navies are carrying out a joint eight-day maritime exercise which began on Friday. The opening ceremony for Exercise Singaroo was held at Changi Naval Base on Friday afternoon, said the Ministry of Defence. (Image: The opening ceremony for Exercise Singaroo was held at Changi Naval Base on Friday afternoon.) Both navies will conduct a range of maritime operations, such as maritime surveillance, air defence and anti-submarine warfare. The Republic of Singapore Navy is taking part with a frigate (RSS Intrepid), a missile corvette (RSS Valour) and a submarine (RSS Conqueror). Joining them are a guided missile frigate (HMAS Arunta) and a patrol boat (HMAS Bathurst) from the Royal Australian Navy. Aircraft from the Republic of Singapore Air Force will provide anti-surface warfare support for the exercise. This series of annual exercises aims to enhance the interoperability of the two navies, said Mindef. Singapore and Australia share close and friendly defence ties. Both their navies engage in a wide range of activities, which include bilateral and multilateral exercises as well as professional exchanges. 'These extensive interactions have strengthened mutual understanding and professional ties between the personnel of both navies,' said Mindef

DTN News: Australia Begins Search For Submarine Designers

DTN News: Australia Begins Search For Submarine Designers

*Source: DTN News / Int'l Media

(NSI News Source Info) SYDNEY, Australian - August 8, 2009: Defence Minister Sen. John Faulkner announced Aug. 6 that Canberra will call for tenders in the near future to carry out a design study for the Royal Australian Navy's Future Submarine project, code-named Sea 1000. The 12-boat program is expected to be the most expensive defense procurement undertaken by Australia, with estimates ranging up to 20 billion Australian dollars ($16.8 billion). The 2009 defense white paper, published in May, revealed that the Navy's six Collins-class boats will be replaced by about 2025 by 12 conventional submarines. The white paper calls for the Future Submarine to be more capable than the current 3,500-ton Collins-class boat, with greater range and patrol endurance, and armed with land-attack cruise missiles as well as heavyweight torpedoes. A spokesman for Faulkner said the request for tenders announced by Faulkner and his deputy, Greg Combet, the defense materiel and science minister, is designed to assess whether Australian companies have the capacity to design such a submarine. The request also will help the government's defense procurement agency, the Canberra-based Defence Materiel Organisation (DMO), determine the feasibility of establishing an indigenous submarine design capability in Australia. "My interpretation of their announcement is exactly that," said Graham Bulmer, acting CEO of the Collins-class builder, ASC Pty Ltd., Port Adelaide. However, he said, the wording of the announcement is ambiguous, and until the request itself is released, Bulmer declined to speculate on what ASC's response might be. At present, there is only one company in Australia recognized as a submarine design authority, and that is ASC, which established in 2007 a research and development subsidiary, Deep Blue Tech, to carry out self-funded research and development for the next generation of submarines. Bulmer said he couldn't say whether ASC or Deep Blue Tech might respond to the request. This is the second stage of a two-part process that began earlier this year, when a team of Navy and DMO officials visited submarine construction yards in the U.S. and Europe to assess design and technology options. The request is a tacit acknowledgement that there is no submarine available off the shelf that meets the Navy's needs, said Terry Roach, vice president of the Submarine Institute of Australia, a Canberra-based group comprising many former Navy submariners. Roach himself is a former Navy submarine captain and former director of the Navy's Submarine Warfare Systems Centre here. The institute published a paper last year setting out the key design factors for the Future Submarine project and urged the government to invest in the R&D required to support the design, construction and sustainment of a new fleet of submarines. The Navy has unique requirements for range, submerged endurance, speed, stealth and payload. The Navy/DMO study tour this year confirmed that no existing conventional submarine can meet these requirements, Roach said Aug. 7. In addition, the Navy has a close strategic relationship with the U.S. Navy, with whom it collaborates on the development of the AN/BYG-1 submarine combat management system and the Mk48 Mod. 7 heavyweight torpedo. To maintain that vital relationship and protect sensitive U.S. technology, Australia must have a secure, indigenous design and project management capability, rather than working with a European designer, Roach said. All that points toward ongoing investment in indigenous submarine design capabilities. The domestic design study forms part of the initial definition phase of Project Sea 1000, which is due to end in December. It will be used to shape the design, procurement and production process for the Future Submarine, Roach said. Phase 1A of the Future Submarine project, the concept design process, is due for Cabinet approval in 2010 or 2011, with the preliminary design stage, Phase 1B, due to get underway between 2011 and 2013. The detailed design for the Future Submarine in Phase 1C will get underway in 2013. The construction of the first submarine in Phase 2 of Project Sea 1000 will commence afterward.

DTN News: Nulka Secures 11th Successive Production Order From Australian Government

DTN News: Nulka Secures 11th Successive Production Order From Australian Government

(NSI News Source Info) MELBOURNE, Australia – June 2, 2009: The Australian Government has awarded BAE Systems another contract to produce additional Nulka anti-missile decoy rounds. The contract, valued at AUD $48.2 million, will see BAE Systems Australia produce additional Nulka rounds for use by the Australian, United States and Canadian Navies. BAE Systems is the prime contractor responsible for design, development and integration of the Nulka system. Two US sub-contractors, Lockheed Martin and Aerojet, manufacture the electronic warfare payload and the rocket motor respectively. Simon Forrest, BAE Systems Program Manager, confirmed that this latest and 11th successive annual order would see production extended to 2012. “To date approximately 860 Nulka rounds have been produced for the Australian, United States and Canadian Navies. The Nulka system has now been installed on more than 125 surface combat ships, with deployment on further ship classes planned,” Mr Forrest said. Nulka is a rocket propelled active decoy designed to lure anti-ship missiles away from their intended target. Originally conceived in Australia, and developed under a joint Australian and United States program, it provides warships with a highly effective all-weather defence against anti-ship missiles, bringing together hovering rocket, autonomous system and electronic technologies. About BAE Systems: BAE Systems is the premier global defence, security and aerospace company delivering a full range of products and services for air, land and naval forces, as well as advanced electronics, security, information technology solutions and customer support services. With approximately 105,000 employees worldwide, BAE Systems' sales exceeded £18.5 billion (US $34.4 billion) in 2008.

Australia Reveals Naval Expansion Plans

Australia Reveals Naval Expansion Plans

(NSI News Source Info) SYDNEY - May 5, 2009: Australia's defense budget will continue to grow beyond 2030 to sustain a significant increase in the size of the Royal Australian Navy as well as an overhaul of the rest of Australia's combat equipment. Three Hobart-class Air Warfare Destroyers are under construction for the Australian Defence Force. (PH2 MATTHEW BASH / U.S. NAVY) This was one of the key messages from Australia's long-awaited defense white paper, which was released by Prime Minister Kevin Rudd here May 2. The paper revealed plans to double the Navy's submarine fleet from six boats to 12 over the next 30 years. These new submarines, along with the planned replacement for the eight Anzac-class frigates and the three Hobart-class Air Warfare Destroyers, which are already under construction, will be armed with sea-launched, land-attack cruise missiles. And the Australian Defence Force (ADF) will acquire what the white paper terms "a satellite with a remote sensing capability, most likely to be based on a high-resolution ... synthetic aperture radar." The paper also confirms the Air Force's commitment to purchase "around 100" F-35A Joint Strike Fighters. Underpinning these and other planned purchases, the government has promised to continue increasing the defense budget by an average of 3 percent per year in real terms, out to the 2017-18 fiscal year. This is on top of the annual inflation index of 2.5 percent, which will be maintained to 2030, and amounts to 107 billion Australian dollars ($78.23 billion) in defense spending over the next four fiscal years alone. The 2008-09 defense budget is 22 billion Australian dollars. Details of the defense budget for the 2009-10 fiscal year, which begins July 1, won't be revealed until the government's annual budget announcement May 12. But Defence Minister Joel Fitzgibbon announced that his department will launch a strategic reform program designed to harvest cost savings of up to 20 billion Australian dollars over the next 10 years; the savings will be reinvested in the defense portfolio to pay for personnel and equipment. "The truth is we are seeing a period of significant military and naval expansion in the wider Asia-Pacific region, and it's important, therefore, that Australia makes proper provision for that in our own planning horizon," Rudd told reporters here at a press conference May 2. The 140-page white paper, "Defending Australia in the Asia-Pacific Century: Force 2030," highlights the importance of Australia's alliance with the U.S., as well as the growth of China and India. "Within the Asia-Pacific region, economic growth should help foster stability and security," Rudd said at the paper's release. "But there are likely to be tensions between the major powers where the interests of the United States, China, Japan, India and Russia intersect. While the chance of direct confrontation between any of these major powers is small, there is always the possibility of miscalculation." But he predicted the U.S. will remain the most powerful and influential global and regional power out to at least 2030. "No other power will have the military, economic or strategic capacity to challenge U.S. primacy over the period covered by this white paper," Rudd said. "Furthermore, our alliance with the United States will remain the bedrock on which Australia's national security is built. This alliance is enduring and remains vital to Australia's future defense." While the white paper doesn't point to a more powerful China as a military threat to Australia or the wider region, it states, "The pace, scope and structure of China's military modernization have the potential to give its neighbours cause for concern if not carefully explained, and if China doesn't reach out to others to build confidence regarding its military plans." However, the paper also notes that Australia is one of the most secure countries in the world by virtue of its geography. To keep it that way, the country's strategic priorities are to help maintain a secure immediate neighborhood; help contribute to strategic stability in the Asia-Pacific region; and help promote and contribute to a stable, rules-based global security order. To address these priorities, the ADF will remain structured to meet a hierarchy of tasks, Rudd said. "This means we need to have the capacity to act independently where we have unique interests at stake and do not wish to be reliant on the combat forces of others, lead military coalitions where we have shared strategic interests at stake with others, and make tailored contributions to military coalitions where we share wider strategic interests with others." Improving the ADF's readiness will be a priority, Rudd pledged. "Over the next decade, we will be devoting approximately 30 billion [Australian dollars] to fixing the existing force. This includes approximately 6 billion for more than 50 new projects to fill the crucial gaps that have been left in equipment and protection for our women and men in uniform, approximately 18 billion to top-up existing projects that have been underfunded in the past, and approximately 6 billion to fix systems and infrastructure that support our women and men in uniform."

Australia To Buy US Jets, Build Up Navy, Air Force

Australia To Buy US Jets, Build Up Navy, Air Force

(NSI News Source Info) CANBERRA, Australia - May 3, 2009: Australia plans to buy 100 state-of-the-art U.S. jet fighters and double the size of its modest submarine fleet in a bid to keep pace with an Asian military buildup. Prime Minister Kevin Rudd, announcing the plan on board the HMAS Stuart in Sydney Harbour on Saturday, said Australia's military must be prepared for any situation. Prime Minister Kevin Rudd, right, announces the government's defense white paper as Chief of the Defense Force Angus Houston, left, looks on, aboard HMAS Stuart at Garden Island naval base in Sydney, Australia, Saturday, May 2, 2009. Its 140-page white paper - Defending Australia in the Asia Pacific Century: Force 2030, released on Saturday - outlines defense and strategic planning and signals what the government calls a major new direction aimed at building a "heavier" naval, air combat and logistics capability in the Asia Pacific. "It's important for our own capability requirements ... for the Australian Defense Force to be prepared to meet a range of contingencies arising from military and naval buildups across our region," Rudd said. "That is prudent, long-term defense planning, and we believe we've got the balance absolutely right." The major defense update also says that global warming and shortages of fuel, food and water will likely be emerging threats to world peace as countries seek to guarantee supplies of crucial resources. The plan says world powers will jockey for naval supremacy in the Indian Ocean as it gains importance as a seaway for oil shipped from the Middle East to Asia. It does not single out any single country as posing a military threat to Australia, which is a close military ally of the United States. The plan focuses on building Australian naval and air force strength to take any fight over Australia's security far offshore. To do this, Australia's current fleet of six Collins-class submarines will be replaced by 12 longer-range Australian-manufactured submarines. The government, which bans atomic energy in Australia, has ruled out nuclear propulsion. The navy's 12 frigates will also be replaced by the same number of larger warships. Australia will remain without an aircraft carrier. The government plans to buy 100 U.S.-manufactured Lockheed F-35 Lightning Joint Strike Fighters to phase out the current Boeing F/A-18 Super Hornets over the next decade. But the opposition Liberal party argued that the report doesn't explain how the new equipment will be funded. "Nobody reading this white paper could have any confidence that the government has the capacity, the commitment, or even knows how it is going to pay for this dramatic expansion in our military hardware," opposition leader Malcolm Turnbull told reporters in Sydney. Rudd recently warned that Australia needed to reshape its military in response to an "explosion" in defense spending in Asia. Saturday's plan said the global economic downturn would slow the recent arms buildup in some Asian countries, though China will likely continue its military modernization, it said. "But the pace, scope and structure of China's military modernization have the potential to give its neighbors cause for concern if not carefully explained," the paper says. "China has begun to do this in recent years, but needs to do more." Prime Minister Kevin Rudd, center bottom, announces the government's defense white paper aboard HMAS Stuart at Garden Island naval base in Sydney, Saturday, May 2, 2009. Its 140-page white paper - Defending Australia in the Asia Pacific Century: Force 2030, released on Saturday - outlines defense and strategic planning and signals what the government calls a major new direction aimed at building a "heavier" naval, air combat and logistics capability in the Asia Pacific. The government is committed to increasing defense spending, which is 22 billion Australian dollars ($16 billion) in the current fiscal year, by 3 percent each year despite the current recession. Australia is the largest contributor to the U.S.-led coalition force in Afghanistan outside NATO. Rudd announced this week that the Australian military commitment there would be boosted from 1,100 to 1,550.

BAE Pushes For Australian Seahawk MRO Deal / BAE Systems Committed To Nowra For Seahawk Support Contract

BAE Pushes For Australian Seahawk MRO Deal / BAE Systems Committed To Nowra For Seahawk Support Contract

(NSI News Source Info) NOWRA, Australia - March 12, 2009: BAE Systems plans to establish a world class aviation maintenance facility in Nowra, NSW, if it secures the contract to support the Royal Australian Navy’s S-70B-2 Seahawk helicopter fleet.

Jim McDowell, Managing Director, BAE Systems Australia, said today the company remained committed to Nowra as the long term home of its naval helicopter support operations.

“BAE Systems has been providing deeper maintenance support for Navy helicopters based out of Nowra since 1993,” Mr McDowell said.

“If we are selected in response to a current tender process, we plan to establish a new helicopter support capability at the Albatross Aviation Technology Park, adjacent to HMAS Albatross. “This proposal will enable cost effective investment in a long term facility solution at Nowra and support of a sustainable Nowra based industry capability for the Seahawk Mission System and broader Navy requirements,” he said.

The deeper maintenance facility at Albatross Aviation Technology Park, to be known as the Navy Helicopter Support Centre will incorporate the previous Seasprite facility and a purpose built maintenance facility.

The company is leading a defence helicopter industry alliance, known as the Seahawk Support Team, together with partners Raytheon Australia, Rosebank Engineering, and Asia Pacific Aerospace and Air Affairs, in its bid for the contract. Raytheon Australia is the leading provider of avionics maintenance and engineering services to the ADF across multiple aircraft platforms. “The release of the RFT for an initial period of seven years, and lifting a restriction that mandated government furnished facilities at HMAS Albatross has allowed the Team to offer the Navy a much improved industry support model for the Seahawk helicopter,” Mr McDowell said.

BAE Systems is the premier global defence and aerospace company delivering a full range of products and services for air, land and naval forces, as well as advanced electronics, information technology solutions and customer support services. With approximately 105,000 employees worldwide, BAE Systems' sales exceeded £18.5 billion (US $34.4 billion) in 2008.

Maltese Armed Forces Order Patrol Craft Fleet

Maltese Armed Forces Order Patrol Craft Fleet

(NSI News Source Info) February 19, 2009: Austal has secured its first European defence contract with an order for four 21.2 metre inshore patrol craft - including training and spares support - with the Armed Forces of Malta (AFM).The vessels will be built at Austal’s Australian facilities and are scheduled for delivery by the end of the year. Intended to assist the AFM with surveillance and border protection throughout Malta’s coastal waters, the vessels will have a maximum speed of more than 26 knots and will be capable of supporting 7.62mm and 12.7mm guns. The new order adds to Austal's current patrol craft contracts comprising six high speed vessels for the Trinidad and Tobago Coast Guard and three patrol catamarans for the Queensland Police. Austal also has contracts to design and build the US Navy’s 127 metre Littoral Combat Ship (LCS) and 103 metre Joint High Speed Vessel (JHSV). Managing Director Bob Browning said Austal was fielding increased interest from nations seeking fast and economical aluminium patrol craft for protection against modern-day coastal border security threats. “Following significant patrol boat deliveries to countries including Yemen, Kuwait and Australia, Austal is pleased to add Malta to its growing defence customer base while making important inroads into the traditionally self-reliant European defence market,” Mr Browning said. Austal was awarded the contract following a competitive international tender process, which called for a proven design that addressed specific AFM requirements, as well as meeting a demanding delivery schedule. Once completed, the order will bring Austal’s total number of defence vessels to more than 60, including the 14 Armidale Class patrol boats built for the Royal Australian Navy, 10 vessels for Yemen and eight Australian Customs vessels. Austal Vice President - Global Defence Sales, John Caccivio said Austal’s advanced aluminium defence platforms - typified by their speed, shallow drafts, flexibility and reduced maintenance costs - were finding increased global relevance. “To now extend our reach to the European defence market – a market that usually shows preference towards domestic builds – underlines not only the uniqueness of the Austal product but also the evolution of maritime security challenges, such as piracy and terrorism, within global littoral waters,” Mr Caccivio said. By utilising a planing aluminium hull, the 21.2 metre inshore patrol craft combines economical performance at all operational speeds with superior seakeeping in varying sea conditions. Speaking at yesterday’s contract signing ceremony in Malta, AMF Lt Col Martin Sammut said the vessels were a logical progression from the AMF’s current fleet. “These patrol vessels will enhance the border surveillance capabilities owing to better sea-keeping characteristics, extended range of operations, and better endurance than the current inshore patrol boats. These aluminium vessels will be operated by a maximum crew of 8 personnel and will be a major improvement in crew comfort and safety owing to better crew accommodation and enhanced catering and messing facilities,” Lt Col Sammut said. AFM responsibilities include maintaining Malta’s territorial waters through combating terrorism and illicit drug trafficking, conducting anti-illegal immigrant and anti-illegal fishing operations, operating Search and Rescue (SAR) services, and physical/electronic security/surveillance of sensitive locations.

Australia: Budget Cuts Shelve Plans For Collins-Class Submarines

Australia: Budget Cuts Shelve Plans For Collins-Class Submarines (NSI News Source Info) February 16, 2009: PLANS to build a fourth $2 billion Air Warfare Destroyer in Adelaide may be abandoned as the economic downturn hits federal revenue. The recommendation to shelve plans to extend the $5.5 billion destroyer project at Osborne-based ASC Shipbuilding is understood to be contained in a draft of a top-secret Defence White Paper. It includes plans to mothball one or two of the Collins-Class submarines. The Collins class submarines are the current class of submarines serving in the Royal Australian Navy (RAN). The class is made up of six vessels: Collins, Farncomb, Waller, Dechaineux, Sheean, and Rankin; all six are based at HMAS Stirling in Western Australia. They were built by the Australian Submarine Corporation at Osborne, South Australia. Entering service from 1996, the class replaced the Oberon class submarines previously operated by the RAN. This comes amid a severe breakdown of goodwill between the Government and Defence chiefs over the impact of cutbacks to perks the officers enjoy, including limousines and valet services. Navy chiefs lobbied for a fourth destroyer, but the global economic meltdown has seen that idea killed.It also means Adelaide's highly skilled defence-technology and ship-building industries face an uncertain time because the fourth ship was expected to form a bridge of work to the next big contract, the replacement vessels for the Adelaide-built Collins-Class submarines. It is understood that the existing Air Warfare Destroyer contract to build three destroyers at Osborne will not be affected. Mothballing the submarines may involve placing the boats in dry-dock and redeploying the crews to other duties. This would come at serious cost to the nation's maritime defences. Shelving or delaying the fourth destroyer flies in the face of widespread strategic advice and recent comments by Prime Minister Kevin Rudd that Australia faces a growing threat in the region. "There has been an arms race under way, or an arms build-up, let me put it in those terms, across the Asia-Pacific region for the better part of the last decade," Mr Rudd told the RSL's national conference last September. "What I'm saying is that when I look at the Australian navy, we need to make sure that we have enough capability there to deal with future challenges." Proposed cuts to senior officers' perks have sparked what Defence insiders have dubbed "the battle of the butler". The Advertiser has been told many senior officers are angry about losing taxpayer-funded butlers, valets, batmen, housekeepers, cooks, drivers, first-class travel entitlements (reduced to business class), spouse travel and access to the RAAF's luxury VIP aircraft. Some senior officers have threatened to resign if the Government proceeds with the cuts. The White Paper is still with the Defence Department, but will be taken to Cabinet's National Security Committee next month for approval before a late-April release. The document includes a new and more realistic funding model for spending based on a "defence oriented index". The White Paper includes major savings proposals such as extending the life of three guided-missile frigates and keeping the air force's F/A-18 Hornet fighters flying longer. Defence Minister Joel Fitzgibbon told The Advertiser yesterday he would not pre-empt the White Paper nor would he confirm or deny any initiatives. "I am determined that we deliver value for taxpayers' money and that our people on the frontline have all the capability, protection and training they need," he said. "The Defence leadership has been co-operating and is working with me to achieve these objectives." Top brass will keep generous household and travel allowances and other benefits such as free rent and health care as well as annual salary packages ranging from $344,000 to $428,000. The cuts are part of a massive efficiency drive under the White Paper and the millions of dollars saved will be redirected to the "sharp" end of defence. Mr Fitzgibbon instructed the White Paper team, led by ambitious Defence toe-cutter Mike Pezzullo, to ensure the efficiency gains would be felt by everyone in Defence, including top brass. "He wanted prominent and visible signs that the senior people were making changes," a source told The Advertiser. There are about 150 "star"-ranked officers in the Australian Defence Force who will be affected by the cuts. In some cases the loss of car and driver will reach down to colonel level, but those most affected are the chiefs of the navy, army and air force who occupy taxpayer-funded historic houses. Vice-Admiral Russ Crane, Lieutenant General Ken Gillespie and Air Marshal Mark Binskin will all lose their cook, housekeeper and butler/valet as well as their limousine and driver. Defence Chief Air Chief Marshal Angus Houston keeps most of his entitlements for security and entertainment purposes, but even he will be travelling in business class from now on without his wife. In future, spouse travel will be allowed only with ministerial approval. ACM Houston had his first taste of the new order recently when he was denied access to the air force's VIP jet. He travelled to Hawaii for a high-level meeting in star class on budget airline Jetstar. Other senior officers have had low-priority, but expensive, travel plans cancelled at the last minute.